There are 4 main types of POS software:

This software is cloud-based and comes as an app on your smartphone or tablet. It’s usually compatible with a receipt printer and a credit card swiper, but not as powerful as a full terminal POS system. It’s ideal for sole traders such as plumbers or mobile food cart owners.

The tablet version is similar to mobile POS software, but offers more features and capabilities. You could use tablet POS software to manage a large and complex retail businesses with multiple locations, including inventory tracking, employee time tracking, payroll, and accounting. They are compatible with many POS hardware solutions to form a complete POS system for any situation.

This is a fixed POS software with full back-office capabilities. It can be cloud-based or on-premise. Terminal POS software is best suited to large retail or online stores, spas, malls, and other brick and mortar businesses.

This is designed to be used in kiosks and outdoor units where it's not practical to post an employee. It is often integrated with another POS system nearby, like to provide an extra sales point in busy grocery stores, coffee shops, or food trucks. It can be cloud-based or on-premise since it's not used with a mobile system.

You’ll also find POS software designed for the unique needs of specific industries, such as restaurant and hospitality businesses, apparel retail, financial services, academia and education, and pharmaceuticals POS software.

The costs of your POS software will vary depending on the type of software you choose. Mobile POS software, such as a smartphone app, can begin at $50 per month, while more complex software can reach several hundred dollars monthly. When you buy POS software, you’ll usually need to pay an upfront purchase price, plus an ongoing monthly or yearly payment processing fees.

Other factors that may affect the cost of your POS software plans include:

How many features you add

Any hardware included

Number of integrations

Your operating system

Point of Sale systems vary greatly in price depending on the type and size of business you’re looking to equip. There are two costs to consider when looking for a POS system: monthly software fees and an installation fee. 

Monthly software costs go anywhere from $0 to $100+ a month. Most paid POS programs will cost you between $15 and $30/month. Installation fees usually include software installation, as well as the hardware itself. Paid POS systems don’t always have user caps, meaning that an unlimited number of workers can use the program to make transactions.

There are, of course, “free” POS systems. This means that the hardware and monthly plans start at $0 but they charge businesses per transition. For example, a POS provider can charge anywhere from 2 to 4% plus a few cents per card-based transactions or manual keyed-in sales. 

POS hardware is the indispensable other half of your POS system. You’ll need to get the right hardware to match the actions and transactions you want to carry out using your POS system. A basic set of POS hardware consists of:

Printer to offer hard copies of receipts (retail stores, restaurants, and other brick and mortar businesses are likely to need this)

A POS terminal, or iPad or Android tablet to run your POS software

Credit card reader

A cash register to keep cash transactions secure and logged into your system

Depending on your business, you might also need:

Extra tablets so wait staff can process payments at the table in restaurants

A router to strengthen your internet for cloud-based POS systems

A local server to host your on-premise POS software

Weight scales for food retailers

Barcode scanners

Networking cables to connect all of your hardware

An extra kitchen printer

Self-serve checkout kiosks

With a POS system, your business can retain more customers through a better, targeted loyalty program and you can also track inventory so that you never run out of stock unexpectedly. A POS system can help you run complex discount offers when appropriate. 

With the right POS system, you can also analyze sales history to discover seasonal buying trends and correlations, which can come in useful when you want to increase sales. You can also remove manual error by using barcode scanners and automatic synchronization, as well as combat absenteeism with a more reliable employee tracking system.

Other major benefits include improving payment security as well as the ability to make more sales thanks to your ability to accept payments across the market.

A cloud-based POS system stores data on remote servers and can be accessed online, whereas a traditional or on-premise POS system stores data on a local server and can be accessed through an internal network. Here’s a breakdown of the main differences between a cloud-based POS and an on-premise POS:

Cloud-Based POS Systems

On-Premise POS Systems

Relatively low-cost to buy and setup but have higher ongoing costs

Expensive to setup and install, but carries very low ongoing costs

Always accessible from wherever you are, even if you’re out of the country

Comprehensive and extensive. On-premise POS systems can be used for very large and complex retail situations

Highly scalable

Not easily flexible or scalable

Easy to carry around, making it ideal for mobile types of businesses

Not easily portable, making it a poor choice for mobile businesses

Dependent on a good internet connection

Not reliant on the internet, so your POS system is always up and running even if the internet is down

Able to keep your data backed up on the cloud so that you won’t lose anything if the system crashes

At risk of losing all of your data if the server crashes

Easy to integrate with other business apps

Operated on a local server with all of your data and apps in your own network

If you have long-term business plans and if your requirements are likely to continue to evolve as your business grows, then a cloud-based POS system is probably the best choice for you. On the other hand, if you have fixed needs or a small budget, you might be best served by choosing a traditional POS system. 

Choosing a POS system provider depends on what kind of business you’re running, how long you’ve been operating, and the scale of your operation. Finding the perfect system provider, though, takes some more research.   

Here are some questions, organized by category, that can help you choose the right POS system provider:

What features do I need?

What devices are needed to process payments? 

What hardware do I need? If you need a lot of items, a provider that bundles hardware options together with the software is a better bet, but if you're going to be using your existing iPad, you’ll need something different.

What kind of receipts are generated?

Does the POS system integrate well with my existing business apps?

Is it easy to set up and use? If it’s more complex, does it offer training?

How good is customer service?

Do I want to save money upfront or keep my monthly costs down?

How does payment processing work? What kind of hardware is offered by the POS company? Some POS companies offer technology unique to the brand, while others simply offer iPad rentals. 

Is the pricing plan transparent?

Are the payment processes cloud-based or more suitable for in-person transactions? 

What analytics does it offer and what metrics can it check? Make sure that the ones that are most important to you are included in the package.

Does this POS system provide assistance for inventory management? If yes, it’s valuable to see whether there is help with product visibility, inventory, purchasing and replenishing, storage, analyzing inventory and orders, or multichannel tracking. 

Does this POS system have integrations for eCommerce, email marketing, or social media? A POS system can provide real time information to better customer experience. 

Is it simple to scale up as your business grows?

Finding the perfect POS system can be a game-changer for your business. Businesses across the board are catching on to the power of these systems. In fact, about discounts, loyalty programs, and marketing campaigns. Whether you're looking for a POS for small businesses or managing a larger operation, there's a system out there that fits your needs and budget. 

Top contenders like Toast, Lightspeed, and Square each offer unique strengths—from restaurant-specific features to multi-industry versatility and small-business simplicity. 

As you evaluate options, consider how each system aligns with your specific needs, whether it's robust inventory tracking, seamless payments, or powerful analytics. Ultimately, investing in the ideal POS is an investment in your company's efficiency, growth, and long-term success.